Friday, May 27, 2005

Chinese Governmant starts to Privatizes some of its Arms Industry

China on May 27 issued regulations granting permission for private and foreign-funded enterprises to produce certain categories of weaponry in China, state press said.

According to new regulations issued by the Commission of Science, Technology and Industry for National Defense, private and foreign-funded enterprises would be allowed to produce weapons considered “sub-systems and special auxiliary products,” the Xinhua news agency said.

However, the production and development of weapons considered to be made up of core technologies and equipment would remain tightly controlled by the state, Xinhua said.

“It means if they meet certain standards, including technological level and financial strength, private and foreign-funded companies face no policy barriers” to entering business in the first category, Liu Dongkui, a commission director, was quoted as saying.

Liu said the classification system would help to standardize the weapons development and production industry, promote moderate and orderly competition and improve the level of the national defense industry.

He said the commission would issue about 300 weapons development and production licenses in the second half of this year.

A few private businesses were among the candidates to be considered.

“But there’s no fixed link between a license and production orders. Obtaining a license does not guarantee a company production orders,” said Liu.